Chapter 9 - IRAs and SEPs

Question 1

Non-deductible IRA distributions

Answer 1

Partially return of capital and partially earnings

Question 2

Nondeductible contribution and distribution reporting

Answer 2

Form 8606

Question 3

Retirement saver’s credit

Answer 3

To encourage low and middle income taxpayers to save for retirement
% times the amount of qualified retirement savings contributions
Up to $1,000 single or $2,000 MFJ

Question 4

After tax benefit ratio

Answer 4

ATB before withdrawal/FMV of account at withdrawal

Question 5

Roth distribution ordering

Answer 5

Contributions
Conversions
Earnings

Question 6

Ins premium exception to 59 1/2 penalty

Answer 6

Only if unemployed

Question 7

SEP coverage requirements

Answer 7

Age 21 or older
Performed services for 3 of last 5 years
Received compensation of at least $750

Question 8

SEP limits

Answer 8

25% of compensation or $66,000

Question 9

SEP establish date

Answer 9

Due date of income tax return plus extension
Sole proprietorship - 10/15
Partnership 9/15
Corporation 9/15
S corp 9/15